The legal forces favoring mandatory arbitration of employment disputes have won notable victories in recent weeks. But the fierce resistance to arbitration may be having an effect, too, by encouraging the courts to examine arbitration agreements more closely and employers to devise programs that are transparently fair. The close scrutiny of arbitration’s pluses and minuses may even be paving the way for wider use not of arbitration itself, but of mediation, another technique for alternative dispute resolution (ADR). In September, both the U.S. Court of Appeals for the Second Circuit and a California appellate court ruled in favor of employers who had insisted that employees agree to arbitration of employment disputes or be denied employment.
In the California case (Lagatree v. Luce, Forward, Hamilton & Scripps, Calif. Ct. App., Nos. B124263 and B125272, 9/13/99), the plaintiff, Donald Lagatree, was fired twice from jobs as a legal secretary when he refused to sign mandatory arbitration agreements. One agreement excluded claims under Title VII and some other statutes, and also provided that the losing party would bear the entire cost of the arbitration; the other required the arbitration of all disputes between the employer and employee. Lagatree unsuccessfully challenged both agreements, arguing that there was a violation of public policy in the denial of a jury trial and a judicial forum.
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